Last Friday, the Dow Jones Industrial Average (DJI) gained 498 points. But this 1.18% rally was not enough to end the index’s three-week losing streak. Investors did not experience an unusually long downtrend since the 1970s. When will this negative streak end? Will a Santa Claus rally happen this week to help?
On Friday, the government posted that November’s personal consumption expenditures price index increased by only 0.1% month-over-month. This annualizes to 2.4%. The PCE index measures consumer spending on goods and services in the U.S. economy. The Federal Reserve prefers this measure over the CPI.
The companies with the biggest weight on the Dow are Goldman Sachs (GS), UnitedHealth Group (UNH), and Microsoft (MSFT). Among them, UNH’s plunge from over $620 to $500.13 last Friday hurt the Dow the most. However, it pulled capital markets giant Goldman Sachs lower.
Microsoft, one of the magnificent 7, broke out in late November. It has the momentum to take back the $468.35 high reached in July. To get there, the firm best known for Office 365 and Windows will need more CoPilot subscribers.
Until Microsoft proves that consumers are willing to pay for CoPilot, powered by ChatGPT, the stock will trade in a range.
CoPilot for Microsoft 365 costs $30 per user per month.
